All the Single Ladies – Here’s How to Reduce the High Cost of Being Single

Posted in Budgeting & Planning, Marriage & Relationships on

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A dear friend of mine shared this Mint infographic with me: The High Cost of Being a Single Lady. It depicts the cost of being a single female over one’s lifetime. That’s close to a million dollars–assuming a salary of $80,000 per year. I’d like to share my take as a CERTIFIED FINANCIAL PLANNER™ and a single lady…

Control What You Can Control

Being a single lady looks daunting financially. However, I work with a number of single clients and they are making financial progress. Part of that progress is answering the question: what is in your financial control?

Here’s one example: we might not be able to control the fact we’d pay less in taxes if we were married. According to the graphic, single women pay $39,000 more in taxes over a lifetime (assuming an income of $40,000). But we can reduce our income taxes by contributing to a 401(k) or IRA or both. That also gives us retirement savings for the future and might help make up for the Social Security that you won’t be receiving from a spouse ($39,768). Sure, a married woman can contribute to a 401(k) as well. The point here, is to look at your particular circumstances and what you can do to make improvements. This will help put a plan in place that is meaningful and workable for you.

You can also “pad” your emergency fund. This is important because single people don’t have the benefit of relying on a spouse’s income for a job loss or other unforeseen need.

Another element to a single person’s financial plan that the graphic doesn’t address is risk exposure. Many single people, not just women, don’t have a spouse or children to care for them or support them if they become ill or disabled. Long term care and disability insurance can address these concerns and provide needed protection.

I love this story about single women who made a communal home meet their needs later in life. It also touches on the care issues mentioned above. They were willing to think outside the box in order to share expenses and embrace communal living to continue their independence.

“Lean In” Financially

SaveUp is encouraging us all to improve our finances. In SaveUp’s March Data Report, they focused on women “leaning in financially.” This includes being aware of our financial predispositions and asking for raises. Here is an excerpt from the report that I think is great guidance.

SaveUp Recommends 5 Tips Women Can Follow to “Lean In” Financially:

1.) Negotiate for increased wages at all opportunities

2.) Aim higher on the amount of money to save each month

3.) Increase exposure to market returns on long term savings

4.) Continue to maintain low unsecured debt

5.) Continue to invest in higher education and career growth

The infographic is an important reminder to single women that they need to make their finances a priority in order to combat the financial disadvantages that are depicted. There are also potential advantages when it comes to prioritizing spending and savings. For instance, you don’t have to “negotiate” with a spouse. Unfortunately, money is a common source of stress in relationships. The New York Times also ran this article a few years back that offers insight and resources when it comes to women and personal finance.

Mint has also released a second infographic on the High Cost of Being a Single Man. Gather resources and control what you can control to meet your personal financial objectives in order to SaveUp!

This post was written by SaveUp’s personal finance contributing writer, Catherine Hawley, CFP®.

Image source: Forbes

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Written by Catherine Hawley

Catherine is a CERTIFIED FINANCIAL PLANNER (TM) who offers accessible and objective financial advice to individuals and families. Her aim is to help clients gain clarity and confidence so they can pursue their definition of financial success. You can find more information about her independent practice at www.catherinehawley.com. She has worked at Rhodes & Fletcher, LLC as a Personal Benefits Specialist and at the firms of Bernstein Global Wealth Management and Barclayʼs Global Investors. Catherine has a bachelors degree in communication studies from the University of California, Los Angeles where she was a scholarship athlete and captain of the womenʼs tennis team.